Tax Increment Financing

The ability to identify available financing options can make or break a potential development project.

If your business is adding jobs or making a large capital investment, there may be public incentives available to assist you. The most powerful financing tool available through municipalities is Tax Increment Financing (TIF).

TIF puts your property tax dollars to work in the form of an upfront investment in your project or ongoing property tax rebates.

While the mechanics of TIF are complicated, and negotiations can be rigorous, Baker Tilly is here to help your company navigate the complex world of Tax Increment Financing and maximize the amount of money available for your project.

Basics Tax increment financing (TIF) is a public financing mechanism that can be used to subsidize development projects, infrastructure, and community investment. Through the use of TIF, municipalities capture new property tax revenue in a defined area. Those incremental revenues can be spent on projects in that district, including business and developer incentives.

Benefit Determining how much funding your project could receive requires research, analysis, and negotiation. If a project aligns with a community’s goals, you could receive 10-20+% of the total project costs in the form of a TIF investment.

Being Successful Successfully negotiating a Tax Increment Financing incentive requires a thorough understanding of TIF rules and regulations and effectively selling the benefits of your project to the municipality. This process can allow you maximize TIF benefits to offset a portion of your project costs and make investments more feasible and profitable.

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